Occasionally,we see MBS trade DOWN if economic data is much much weaker than expected and tsy's perform well.  This AM however, even tsy's are down.  This may be due to the tsy's being overbought the past few days and the sell off pulls MBS down even though spreads are slightly tighter.

If you have overnight price protection and no rates yet today, locking takes the risk of further losses out of the market, however we have not pushed far below 101-00 on 5.0's.  We've been saying this is a good support level for mid to long term floaters, if MBS continue to hold here we are probably still ok to float.  But stay closely tuned for the chance of continued selling...